US currency declines during financial turbulence

The US dollar index has dropped to near one-month lows after a Goldman Sachs forecast that Washington will likely halt rate hikes. The US Federal Reserve (Fed) has announced a new emergency program to protect bank clients and made a "systemic risk exception" to allow both insured and uninsured depositors of the failed banks to regain full access to their money. Additionally, the Fed has made additional funding available for banks in cases of emergency through a new Bank Term Funding Program. There is a historic correlation between higher interest rates and failures of overleveraged financial institutions, and US inflation data release may also affect the Fed's rate hike plans.